Investors hoping for some relief from last year's uncertainty, volatility and various cliff dramas are in for a disappointment, according to Citi's view of the investment climate for the next 12 months. Indeed 2013 is likely to be very similar to last year, Citi says in its "2013 Outlook and Strategies" report. The bank characterises its 2013 view as "Transforming uncertainty into opportunity". Despite the upbeat title, Citi has a "slightly less bullish approach to 2013" than many of its competitors, says John Woods, chief investment strategist in Asia with Citigroup's private bank.
Investors will remain concerned about economic challenges facing the US economy, the unresolved financial crisis in the euro zone and the slowing rate of growth in China, he says. So there will be low growth and policy risk, with the occasional bounce in volatility. At the same time, "the markets are priced at close to perfection with the Vix [volatility index] at 12 and the S&P 4 per cent off its all-time highs". Woods doesn't feel that the fundamentals reflect the extremely positive view that is priced into markets. So investors should focus on yield, look to preserve capital and diversify their holdings. Citi expects equity markets in the euro zone to outperform the US this year.
For many years there has been a practice among banks, insurance companies and telecommunications companies to hire promotional vehicles and park them in busy thoroughfares to drum up business.
These are generally big trucks that have been converted into mobile showrooms. It's money for old rope for these firms since hiring the vehicles and doing them up with promotional signs and company logos and parking them in prime sites costs a lot less than setting up an office. Unfortunately this generally involves parking illegally and so there is the minor risk of a parking ticket. A small price for a prime site.
Recently a reader complained to the police about one of these vehicles, which had been hired by Bank of East Asia and was parked in Tsim Sha Tsui. When the police asked them to move, the bank's representative kept them hanging around for an hour after claiming he had a permit. It turned out this could not be provided since it was locked in the office. BEA still couldn't produce it several weeks later and then, after inquiries by Lai See, it turned out there was no permit. According to BEA's corporate communications department, there'd been a "mistake". The bank did not have "permit" - what it had was a contract with "the vehicle service provider for this promotional campaign, Easy Group (Hong Kong)". Easy Group, which operates a fleet of these vehicles, claims the vehicle is not an "advertising vehicle" despite being plastered with BEA's logo and products, and doesn't need a permit. It denies this is because it is illegal to use or drive an advertising vehicle unless they have a permit from the commissioner for transport. But permits are not granted for commercial use. Transgressors can be fined HK$5,000 and jailed for three months for a first offence. We understand the police are contemplating going to court with respect to this case. HSBC used to use these mobile showrooms until the law was pointed out to them and they have stopped doing it. You would have thought a CSR-aware bank like BEA would see that its promotional activities were doing a disservice to the community and would be reluctant to clog up the streets with these monstrosities. But apparently not.
Restructuring at Haymarket
There are changes under way at Haymarket Media, with Jame DiBiasio elevated to executive editor of Haymarket Financial media with overall responsibility for the group's three titles: Asian Investor, Finance Asia and The Corporate Treasurer. DiBiasio was the founding editor of Asian Investor in 2000 and for a while doubled as managing editor for Finance Asia. He said he would be studying the print and online brands to ensure their quality and that they were moving in the right direction and meeting readers' needs. Finance Asia is to get a new editor. Reading between the lines and knowing DiBiasio it would seem the titles are in for a shake-up. He stressed this was not a cost-cutting move but to improve the brands. He's well-regarded in the industry, has a sharp mind and doesn't suffer fools gladly.